Question

Jaxson McCormick opened McCormick’s Repairs on March 1 of the current year. During March, the following transactions occurred and were recorded in the company's books: McCormick’s invested $28,000 cash in the business in exchange for common stock. McCormick’s contributed $103,000 of equipment to the business. The company paid $2,300 cash to rent office space for the month of March. The company received $19,000 cash for repair services provided during March. The company paid $6,500 for salaries for the month of March. The company provided $3,300 of services to customers on account. The company paid cash of $800 for utilities for the month of March. The company received $3,400 cash in advance from a customer for repair services to be provided in April. The company paid Jackson $5,300 cash as a dividend. Based on this information, net income for March would be:

Multiple Choice

• $16,500.

• $5,600.

• $8,100.

• $16,400.

• $12,700.

Answer 1

The correct answer is $ 12700

Calculation of net income

= Revenue for cash + revenue on account - rent - salaries - utilities

= 19000+3300-2300-6500-800

= $12700

Thus the correct answer is $ 12700